A social welfare organization will jeopardize its exemption under Code section 501(c)(4) if it ceases to operate primarily to further social welfare purposes. In addition, a tax-exempt organization that does not file a required annual return or notice for three consecutive years automatically loses its tax-exempt status. Activities that do not further social welfare purposes, and thus may jeopardize an organization's tax-exempt status if they become the organization's primary activities, include: Social activity Political activity Inurement of net earnings Operating for the benefit of private individuals Business activity (including providing commercial-type insurance) Return to Life Cycle of a Social Welfare Organization
